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ICE Planning Surge of I-9 Audits This Summer

Immigration and Customs Enforcement (ICE) is planning a nationwide increase of Form I-9 audits this summer. Derek Benner, head of ICE’s Homeland Security Investigations unit, told The Associated Press “That another nationwide wave of audits planned this summer would push the total ‘well over’ 5,000 by Sept 30. ICE audits peaked at 3,127 in 2013.” The agency has developed a plan to open as many as 15,000 audits a year, subject to funding and support for the plan from other areas of the administration, Benner said.

The plan also proposes changing the manner of delivery of the ICE Notice of Inspection (NOI) from in person to email or certified mail. Furthermore, after an initial review, by electronically scanning the I-9 forms for suspicious activity, the most egregious cases will be sent to regional offices for more in-depth investigation. Benner said the agency will focus both on criminal cases against employers as well deporting employees who are working in the country illegally.

What does this mean for employers? It is highly recommended for employers to consider conducting a self-audit, to minimize the potential of fines. Civil penalties for knowingly employing unauthorized immigrants can range from $539 to $21,563. In addition, Form I-9 paperwork violations carry a penalty of $216 to $2,156 per worker.

If a company is selected for an I-9 audit, a notice of inspection alerts business owners that ICE is going to audit their hiring records to determine whether or not they are in compliance with the law. Employers are then required to produce their company’s I-9s within three business days, after which ICE will conduct an inspection for compliance. If employers are not in compliance with the law, an I-9 inspection of their business will likely result in civil fines and could lay the groundwork for criminal prosecution, if they are knowingly violating the law.

If an employee submits a document that clearly looks fraudulent, or like it does not identify the correct individual, a managerial staff member should ask the employee to provide alternate documentation from the list of acceptable documents.

On the other hand, if a submitted document is hard to read, unclear, or confusing, no action may be required by the employer. The US Immigration and Customs Enforcement (ICE) guidance related to internal I-9 audits specifically states that an employer “should recognize that it may not be able to definitively determine the genuineness of Form I-9 documentation based on photocopies of the documentation. An employer should not request documentation from an employee solely because photocopies of documents are unclear.”

There aren’t always easy answers for how to handle situations that arise during internal I-9 audits. An employer must balance the risk of being found to have knowingly continued to employ someone without valid work authorization against the potential that their actions will lead to a claim of discriminatory treatment based on immigration status.

New York Sexual Harassment Training Laws

Effective October 9, 2018, all employers must adopt and distribute a sexual harassment prevention policy and provide interactive sexual harassment prevention training to all employees.

The state will be developing a model policy and a model training, so employers will not need to create their own. They will, however, need to administer both the policy and the interactive training. Employers do have the option of creating their own policy and training program, so long as it meets the requirements set by the state.

Policy Requirements:

  • Statement prohibiting sexual harassment;
  • Examples of prohibited conduct that would constitute sexual harassment;
  • Information concerning the federal and state statutory provisions concerning sexual harassment and remedies available to victims, along with a statement that there may be additional applicable local laws;
  • Standard complaint form;
  • Procedure for the timely and confidential investigation of complaints;
  • Statement informing employees of their rights of redress and all available forums for adjudicating sexual harassment complaints administratively and judicially;
  • Statement that sexual harassment is a form of employee misconduct, and that sanctions will be enforced against individuals engaging in sexual harassment and managers and supervisory personnel who knowingly allow such behavior to continue; and
  • Statement that retaliation against individuals reporting sexual harassment or who testify or assist in any proceeding is unlawful.

Interactive Training Requirements*

  • Explanation of sexual harassment;
  • Examples of conduct that would constitute unlawful sexual harassment;
  • Information concerning the federal and state statutory provisions concerning sexual harassment and remedies available to victims; and
  • Information concerning employees’ rights of redress and all available forums for adjudicating complaints.

 *The state’s definition of interactive is not yet known

No Mandatory Arbitration or Confidential Settlements

Contract provisions that require arbitration for claims of sexual harassment are prohibited. Any such provision in a contract entered into after July 11, 2018, will be null and void. The rest of the contract will remain enforceable, assuming it was drafted correctly. However, this provision of the new law may be unenforceable under the Federal Arbitration Act. Until this question is resolved, we encourage employers to operate as if contract clauses that require arbitration of sexual harassment claims will not hold up in court or to consult with legal counsel before continuing to use them.

Confidential settlement agreements with respect to claims of sexual harassment are also prohibited, unless a confidential agreement is the preference of the person who brought the claim. If the claimant does not want confidentiality, employers will not be able to include language that requires it. This provision of the law also takes effect July 11, 2018.

Protections for Non-Employees

Non-employees—such as vendors, contractors, and consultants—now have the ability to file a complaint with the Division of Human Rights if they feel they have been sexually harassed in an employer’s workplace. This expansion of the law has already taken effect.

Stop Sexual Harassment in NYC Act

The New York City Council has passed the Stop Sexual Harassment in NYC Act (the “Act”) on May 9, 2018. This included a package of bills aimed at addressing and preventing sexual harassment in the workplace.

Sexual Harassment Training

  • Effective April 1, 2019, private employers with more than 15 employees (including interns) must provide annual anti-sexual harassment ‘interactive’ training to all employees who work more than 80 hours per year. This training is required to be completed by all employees, including supervisory and managerial employees.
  • First training must be conducted within 90 days of initial hire but employees who received training from a prior employer, within the calendar year, are exempt.
  • New York City Commission on Human Rights will post a model training which employers can use, as long as employers include specific information about their internal compliant process for address sexual harassment complaints.
  • In addition to requirements under state law, the training must also include information concerning bystander intervention, including any resources explaining how to engage in bystander intervention.
  • The enacted bill requires employers to obtain from each employee a signed acknowledgment that he or she attended the training, which may be electronic, and must be maintained for at least 3 years and available for inspection by the NYCCHR.

Sexual Harassment Poster/Information Sheet

  • Effective September 6, 2018 every employer must conspicuously display (in breakrooms or other common areas employees gather) an anti-sexual harassment rights and responsibilities poster designed by the New York City Commission on Human Rights.
  • Employers must post both an English and Spanish version of the poster and should consider additional languages based on the employee population.
    • A Spanish version of the Sexual Harassment Poster must be posted even if no employees speak the Spanish language.
  • Employers must also distribute, to all new employees, an information sheet (i.e., notice) addressing the same information as the poster and which may be incorporated in an employee handbook.
  • The law also requires the City Commission to post resources about sexual harassment on its website, including an explanation about sexual harassment as a form of unlawful discrimination, specific examples of sexual harassment and retaliation, information on bystander intervention, and information about filing a complaint through the City Commission and other government agencies. If signed, this bill would take effect 90 days after signing.

Additional NYC Changes

  • Effective May 9, 2018:
    • Statute of limitations for gender-based harassment complaints made to the NYCCHR is increased from 1 year to 3 years.
    • Employers with less than 4 employees are now subject to gender-based harassment complaints under the New York City Administrative Code.
  • By August 7, 2018, NYCCHR shall post resources on its website about sexual harassment and an interactive tool describing the complain process available through NYCCHR.
  • Additional reporting and training requirements for employees of New York City agencies.

 

Tax Reform Update

As a result of the new tax reform law, the IRS released a new Form W-4 for 2018 along with a new withholding calculator on February 28, 2018.

While employers are not required to obtain new forms from their employees for 2018, because of the new tax law, you may want to encourage your employees to review their withholdings to be sure they are appropriate. As a reminder, the IRS recommends employees review their withholdings and submit a new W-4 at the beginning of each year or when personal circumstances change.

For additional information, please read the IRS news release IR-2018-36 at https://www.irs.gov/newsroom/updated-withholding-calculator-form-w-4-released-calculator-helps-taxpayers-review-withholding-following-new-tax-law.

Elimination of the ACA Individual Mandate Effective 2019

One of the significant updates for the Affordable Care Act, is the elimination of the Affordable Care Act’s individual mandate, effective 2019.

Under the current ACA regulations, the individual mandate requires most Americans to purchase a minimum level of health coverage. Those who fail to do so are liable for a penalty of $695 for an adult or 2.5 percent of household income, whichever is greater. The new Act accomplished the elimination of the individual mandate by reducing the penalty amounts to $0 and zero percent, respectively.

Employer Mandate and Other ACA Features Still in Place

The Act leaves many aspects of the ACA intact, including the individual marketplace, premium subsidies for those earning between 100% and 400% of the federal poverty rate, the ban on insurers charging more or denying coverage based on health factors, and Medicaid expansion.

Most significantly for employers, however, is the employer mandate and reporting requirements, which remain in force. Accordingly, applicable large employers will need to plan around the Code section 4980H(a) (“A”) penalty — which can apply if an employer does not offer minimum essential coverage to at least 95% of its full-time employees and at least one full-time employee buys subsidized marketplace coverage — and the Code section 4980H(b) (“B”) penalty — which can apply if an employer offers full-time employees coverage that is not affordable or does not meet minimum value requirements.

In 2018, A penalty is $2,320 (or $193.33 per month) multiplied by the total number of full-time employees (minus 30). The B penalty is $3,480 (or $290 per month) for each full-time employee who buys subsidized marketplace coverage (capped by the amount of the A penalty).

 

New York Minimum Wage Expanded by Industry

Hospitality Industry


CLICK HERE FOR THE FULL MINIMUM WAGE CHART FOR THE HOSPITALITY INDUSTRY

Fast Food Employee: A Fast Food Employee includes any person employed at or for a Fast Food Establishment whose duties include customer service, cooking, food or drink preparation, delivery, security, stocking supplies or equipment, cleaning or routine maintenance.

Fast Food Establishment: A Fast Food Establishment is a business that primarily serves food or drinks, offers limited service, where customers order and pay before eating, and is part of a chain of 30 or more locations nationally.

Food Service Worker: A Food Service Worker is an employee primarily engaged in the serving of food and beverages to guests, patrons or customers in the hospitality industry.

Service Employee: A Service Employee is an employee, other than a food service worker or fast food worker, who customarily receives tips of at least the Service Employee Minimum Tip Threshold amounts listed on the chart here.

 

Building Service Industry


CLICK HERE FOR THE FULL MINIMUM WAGE CHART FOR THE BUILDING SERVICE INDUSTRY

The New York Department of Labor’s building service industry minimum wage order sets forth the regulations that control the payment of wages to persons employed in the building service industry.

The wage order applies to employees working in both residential and commercial buildings, and defines the building service industry to include “any person, corporation or establishment engaged in whole or in part in renting, servicing, cleaning, maintaining, selling or managing buildings or building space and all occupations, operations and services in connection therewith or incidental thereto.”

Farm Workers


CLICK HERE FOR THE FULL MINIMUM WAGE CHART FOR FARM WORKERS

The Minimum Wage Order for Farm Workers applies only to farm workers employed on farms where the total cash remuneration paid all persons employed on the farm exceeded $3,000 in the previous calendar year.

Miscellaneous Industry


CLICK HERE FOR THE FULL MINIMUM WAGE CHART FOR ALL OTHER INDUSTRIES

The Proposed Regulations cover employees subject to the Miscellaneous Wage Order, meaning that they would affect all New York employees, except those in the hospitality industry, the building services industry and farm workers.

Important Deadlines and Penalties for Employers

Distribution of Form 1095C to Employees

  • 1095C Form must be provided to employees no later than January 31st, 2018
  • Forms can either be provided to the employee directly or mailed. Forms being mailed must be postmarked by January 31st. Employers must obtain affirmative consent to furnish a statement electronically.
  • Penalty: Failure to provide employees with a timely and accurate 1095c can result in penalties of up to $260.00 per form.

Filing of Forms 1094c and 1095c with the IRS

  • The IRS established two separate deadlines for the 1094C and 1095C Forms to be filed.
  • Returns filed on paper must be postmarked by February 28th, 2018. Only companies filing fewer than 250 forms are eligible to file the returns on paper.
  • Penalty: Companies filing more than 250 forms can be penalized up to $260.00 for each additional paper form.
  • Returns that are filed electronically must be e-filed by April 2nd, 2018.

Important Forms and Instructions on Reporting for 2017

The Affordable Care Act reporting requires employers with 50 or more Full Time Equivalent Employees to report on the offer of health coverage to full-time employees and their family member, as well as when the offer was made. Additional reporting such as if the coverage offered was affordable and whether the employees enrolled in the offered health care coverage.

Small employers with fewer than 50 full-time employees are exempt from some, but not all of the ACA’s reporting requirements. For example, self-insured small employers must complete and file Forms 1095B and 1094B with the IRS, as well as provide full-time employees with a copy of Form 1095-B.

Below are the links to the final forms and instructions on the IRS website:

2018 Minimum Wage Updates

To assist with your planning, the following indicates states with increased minimum wage rates effective January 1,2018.

Note:   The New York effective date for minimum wage changes is December 31, 2017.

State Non-Tipped Employees Tipped Employees
Alaska $9.84 N/A
Arizona $10.50 $7.50
California $11.00 (Large ER)$10.50 (Small ER) N/A
Colorado $10.20 $7.18
Florida $8.25 $5.23
Hawaii $10.10 $9.35
Maine $10.00 $5.00
Michigan $9.25 $3.52
Minnesota $9.65 (Large Employer)
$7.87 (All others)
N/A
Missouri $7.85 $3.925
Montana $8.30 N/A
New Jersey $8.60 $2.13 (didn’t change)
New York $10.40* N/A
Ohio $8.30 $4.15
Rhode Island $10.10 $3.89
South Dakota $8.85 $4.425
Vermont $10.50 $5.25
Washington $11.50 N/A

*Minimum wage rates may vary by industry and location within New York State.

We are happy to assist you in complying with these new minimum wage rates. Review your payroll to determine if your business and employees are affected by these changes and notify us of any necessary adjustments. Failure to comply with minimum wage laws may result in substantial penalties.

Important: Associated HCM will not make any changes to your employees’ payroll, including rate changes without your express instructions to do so.

 

Congress Reaches Tentative Deal on ACA Cost-Sharing Reduction Payments

President Donald Trump announced via executive order on Oct. 12 that he was ending payments to insurers for subsidizing low-income market participants, saying the payments are illegal because Congress hasn’t appropriated the money. These so-called cost-sharing reduction (CSR) payments, which subsidized health plans purchased on the ACA’s Marketplace exchanges, are sometimes called “extra savings” and are distinct from the premium tax credits that also subsidize policies purchased through an exchange.

Trump’s executive order does not affect the penalties that large employers are subject to when a full-time employee is not offered ACA-compliant coverage and receives a premium tax credit for a policy purchased through a Marketplace exchange.

Shortly after the executive order was issued, a bipartisan agreement was brokered on the Senate Health, Education, Labor and Pensions Committee by Sens. Lamar Alexander, R-Tenn., and Patty Murray, D-Wash. The agreement, if passed by Congress in new legislation, would restore CSR payments to insurance companies for two years and would give states more flexibility from ACA regulations.

Trump and some GOP congress members have indicated that they want any legislative fix to allow for a wider range of plans to be made available under the ACA, among other changes that might sink the deal if Democrats remain opposed.

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